There have recently been proposals in South Africa about making changes to the Companies Act through the Companies Amendment Bill. One of these changes is to allow workers’ representatives to serve as non-executive directors on company boards. These suggestions have been driven primarily by international trends, but also the long-held ideal in South Africa around workers’ role in business decision making, as evidenced by various provisions in the existing Companies Act and Labour Regulations Act. Making it mandatory to include worker representatives on boards has been met with mixed views and opinions. What has broad acceptance, however, is that stakeholders are playing an increasingly important role in board decision making and not just shareholders as has been the case in the past.
Read on to learn about the key trends, opportunities, challenges and our views on this impending legislation which will impact the governance component of the ESG framework.